Zombie Toxin and Gems: When “Virtual Currency” Costs Real Money

My parents bought me my first cell phone when I was sixteen years old. Soon after, I learned that I could “IM” my friends right from my phone! Although I was thrilled with my new discovery, my parents were not so excited when they received the first phone bill. The phone company had charged us for every IM I had sent. The consequences I faced from my parents that day deterred me from ever using my cell phone to IM again.

iPhone

Parents today seem to have a different approach to cell phone companies who entice their young customers to use their phones’ expensive features. Garen Meguerian is leading a class action suit against Apple, because he did not know that his daughter could use his credit card to buy virtual currency when playing games such as Zombie Cafe and City Story. Meguerian allowed his daughter to download the “free” games, but he did not know that they required users to buy game currency using real currency. Meguerian’s nine year old daughter racked up $200 in credit card charges buying “Zombie Toxin” and “Gems.”

The complaint alleges that Apple designs games to be addicting, and they compel minors to purchase the game currency so they can continue to play. The plaintiffs claim that because Apple enters into contracts for the purchase of virtual currency with children without the consent of their parents, these contracts are all void. Apple’s actions may also implicate the California Consumers Legal Remedies Act, which prohibits companies from misrepresenting their products. Apple misrepresented their games by not being more explicit about the costs of the virtual currency.

The Meguerian lawsuit is based on two main premises. First, the plaintiffs allege that Apple intentionally seeks to advertise and sell their products to minors. They intend children to get addicted to their games, and they intend the children to personally purchase more currency. Apple may respond that they were entering into contracts with the parents, who are the legal owners of the phone. However, this will be a difficult argument if the plaintiffs can prove that Apple targeted their product towards minors. Second, although Apple requires users to enter passwords before they purchase virtual currency, the plaintiffs claim that this is not a sufficient barrier. Apple will argue that if parents keep their passwords private, their children will not be able to make purchases without permission. However, the plaintiffs complain that the password required for purchases is the same password required to activate many other phone features; therefore, parents do not know what their kids are actually using the passwords for. A successful lawsuit may likely result in a wide variety of passwords and warnings in order to warn parents and children exactly what they are getting into.